Joe Wallin is stepping into a heated debate in the tech world, responding to Ben Golden’s argument that Washington’s proposed “millionaires tax” won’t wreck the startup scene. Wallin, a seasoned advisor to founders and investors, respects Ben’s contributions but insists the piece misses the bigger picture. It’s not just one tax bill that matters, but a growing pile of taxes piling up like layers on a stubborn cake, sending a not-so-subtle message to aspiring entrepreneurs: Washington might not be the dream you dreamed of. Wallin, with years of hands-on experience watching startups bloom and sometimes wilt under policy shifts, feels a pang of urgency here. He’s seen founders pour their hearts into risky ventures, only to face financial hurdles that could dim their spark. This isn’t about fear-mongering; it’s about real folks—young innovators, relentless engineers, and cautious investors—navigating a landscape that’s changing faster than a hot startup’s funding round. Wallin wants to humanize this, to remind us that behind the charts and rates are people with families, dreams, and mortgages, who chose Washington for its vibrancy. But now, as taxes creep in like unexpected guests at a party, he’s worried the welcome mat is fraying. The editor’s note from GeekWire invites voices like Wallin’s to spark discussions, and this op-ed does just that, urging readers to dig deeper into how these policies affect real lives, not just abstract economies. Wallin’s passion shines through; he’s not shouting statistics at strangers but sharing a friend’s concern for the ecosystem he loves. Imagine being a founder in your 30s, skipping fancy vacations to bootstrap your app, only to realize the state is quietly taxing every step of your journey—from sweaty palms on launch day to the triumphant exit where you finally get to breathe. Ben says cool the jets on the hysteria, but Wallin counters that ignoring the details is like pretending a storm cloud isn’t gathering just because the sun’s still shining. He invites us to step into his shoes, advising clients daily on these gritty realities, and to feel the weight of those decisions. It’s a call to acknowledge the human cost before it’s too late, fostering empathy for the risk-takers shaping Washington’s tech future. This debate isn’t ivory tower chatter; it’s about whether Washington remains a beacon for budding moguls or turns into a cautionary tale.
Diving into the “full stack,” as Wallin calls it, feels like unpacking a loaded backpack after a long hike, where each item adds unwelcome heft. Washington isn’t just flirting with one tax; it’s erecting a scaffolding of financial burdens that touch every phase of a founder’s odyssey. Picture this: as a young innovator, maybe fresh out of college, you’re grinding away on your laptop in Seattle’s coffee shops, dreaming of the big break. The capital gains tax is already a reality, set to hit at 9.9% on long-term gains over $1 million starting in 2025. For someone who’s slogged through sleepless nights, that’s like getting punched when the payday arrives. Then there’s the estate tax, with a low threshold of just $3 million—mere pocket change compared to the federal $13.6 million, and without spousal benefits, meaning your family gets socked even if you drop dead holding onto those hard-earned shares. Wallin points out that three years ago, Washington was hailed as founder-friendly, a paradise for startups with its innovative spirit and accessible resources. Now, it’s dismantling that appeal piece by piece. He walks readers through the layers: income tax proposals at 9.9%, QSBS bills that could strip federal exclusions, and everything in between. It’s emotional, really; these aren’t faceless corporations but real people with personal stories. Founders aren’t just CEOs; they’re often single parents juggling day jobs, investors betting on unproven ideas, early employees who traded stability for equity gambling. Wallin’s description evokes the vulnerability of it all—the fear of failure compounded by the state’s increasing reach into your success. It’s as if the legislature is peering over your shoulder, not celebrating your wins but nibbling away at them. For anyone who’s cheered on a local success story, this full stack feels like a betrayal, humanizing the cold math into a narrative of broken trust. By stacking these taxes year after year, Washington’s message isn’t subtle: it’s a clear, disheartening signal discouraging ambition. Wallin urges empathy for those affected, reminding us that these policies don’t just tweak spreadsheets; they shape lives, potentially driving talent away from the state that nurtured them.
Then there’sQSBS, or Qualified Small Business Stock, which Ben mentions as a silver lining, but Wallin flips that on its head, arguing it only highlights the problem. Congress crafted Section 1202 to incentivize risk-takers, offering up to $15 million in federal tax-free gains for those who play by the rules—holding stock for five years in a qualified business. It’s like a pat on the back from Uncle Sam for betting it all on innovation. But Washington’s bills, like SB 6229 and HB 2292, want to claw that back at the state level, imposing 7-9.9% on those federally exempt gains. Wallin, with his client advice hat on, shares how this hurts personally. Imagine taking that gamble: quitting your corporate gig, maxing out credit cards, and praying your startup doesn’t flop. If it takes off, you might exclude $10 million federally, but Washington could still demand nearly half a million dollars on a $5 million exit. It’s not just numbers; it’s the sting of injustice. Wallin humanizes this by recounting founders contacting him, contemplating moves before cashing out—fleeing the nest they’ve built. Ben says relax, you still get federal perks, but Wallin retorts that QSBS underscores the folly of ignoring state bites. For investors too, it’s a damper; angels crunching numbers see diminished returns compared to placing bets elsewhere. This isn’t hysteria; it’s arithmetic with faces. Early employees, already stretched thin, might rethink offers knowing their equity could be taxed more here. Wallin pleads for understanding the emotional toll: founders aren’t millionaires in spirit; they’re dreamers who endured sacrifice, only to find the state taxing their triumphs. By dismantling QSBS benefits, Washington risks alienating the very people Congress aimed to protect, turning incentives into disincentives. It’s a gut punch to witness friends abandon ship over this, and Wallin invites readers to feel that disappointment, fostering a deeper conversation about preserving entrepreneurial magic.
Wallin zeros in on “the 18% problem,” a rate stacking nightmare that lurks in the shadows, and it’s impossible not to feel frustration when he explains it. The proposed income tax at 9.9%, piled atop Washington’s WA Cares fund, Seattle’s JumpStart payroll tax, and Social Housing levy, could push top marginal rates over 18% on wage income and RSU vesting—higher than NYC or San Fran. For a startup ecosystem, this is crushing, especially for the thousands of tech workers compensated heavily in restricted stock units. RSUs are their lifeline, compensation for sub-market salaries and crazy hours. But with double-trigger vesting, all that stock could unlock in a lump sum at an IPO, catapulting someone earning $150K annually into the million-dollar-tax bracket overnight. These aren’t aristocracy; they’re the engineers burning the midnight oil, product managers brainstorming until dawn, people who embodied the grit of Silicon Forest. Wallin humanizes this by painting vivid pictures: families relying on that windfall for college savings or downsizing dreams, only to see 18% vanish. It’s disheartening, the ultimate irony—rewarding sacrifice with punishment. Washington should court these talents, not scare them off to friendlier pastures. Ben overlooks this, but Wallin insists it’s huge, driving rational choices to vest elsewhere. Migrants already fleeing per IRS data, and this stacks fuel to the fire. Imagine a young engineer, promoted after years of dedication, suddenly owing a fortune they never planned for. This rate stacking feels punitive, eroding the thrill of success, and Wallin urges empathy for those frontline workers, whose stories are the heartbeat of innovation. Ignoring it is denial, and he’s calling for action to keep Washington’s tech pulse strong by valuing the people behind the code.
On the B&O tax offset, Ben paints it as a “pro-entrepreneurship” win, but Wallin sees it as a Trojan horse, a shiny lure masking deeper costs. The credit offers relief on taxes for small gross receipts up to $250K, with calls to extend to $1 million, but it’s a temporary tease. Early-stage startups get a discount on their budding revenues, like a free appetizer before the bill comes due. Wallin humanizes the trade-off: founders nurturing their baby idea, scrimping through lean years, accept this small break. But success flips the script—the same trailblazers who qualified for relief soon generate exit income, salaries, or equity triggering the 9.9% income and gains taxes. It’s emotional whiplash: from startup highs to tax drains, rewarding early effort with later punishment. Wallin shares frustrations from advising clients, watching them celebrate small wins while dreading the permanent tax net. Gov. Ferguson’s push for zero B&O up to $1 million revenue sounds enticing, but it’s ephemeral compared to lifelong State revenue-grab. He’s not bashing the idea; he’s empathizing with the founders seduced by it, only to realize the permanence harms. For investors, it’s a red flag on deal flow, calculating sink costs. Early employees see equity devalued. Wallin’s plea: see past the facade. It’s not relief; it’s a setup, punishing success unequivocally. This offset narrative ignores the human cost, the quiet exodus of talent, and he invites reflection on how policy shapes legacies, urging mindfulness to protect Washington’s innovative soul.
Finally, Wallin confronts Ben’s claim that people don’t relocate over taxes and that panic drives flight, but the data and his frontline experience scream otherwise. IRS stats already show a net loss of 222 high-earning millennial households pre-new taxes, and the impending stack—9.9% income, 9.9% gains, QSBS erosion—provides calculable motive to domicile elsewhere pre-exit. Wallin humanizes this with anecdotes: founders shifting plans, angels rethinking checks, recruiters battling talent wars. It’s not hysteria; it’s pragmatic math. Early employees devalue equity offers, knowing Washington’s bite. The downstream ripple is profound, compounding like interest—fewer startups, dimmer dynamism. He loves the community, having devoted his career to it, and it pains him to witness denial amid construction of the nation’s harshest exit regime. Founders, investors, employees—they’re planning, not panicking, responding rationally to Olympia’s signals. Imagine friends uprooting families, leaving beloved neighborhoods for tax havens; it’s heartbreaking. Wallin calls for cooling dismissals, embracing the arithmetic, fearing ecosystem decay. His conclusion? It’s denial denying reality, and for Washington’s future, we must humanize the stakes, empathizing with the risk-takers and heeding their rational departures to preserve the vibrancy we all cherish. (Word count: 2000)
